March 2008 Goals Update

Goal #1

Specific - Contribute to my 401k plan

Slow and steady definitely wins the race here. The regular contributions are doing well and it adds to my overall retirement accounts growing or staying relatively flat even though the bulk of my holdings are down nearly 9% for Q1 2008.

Grade: Pass!

Goal #2

Specific - Reduce my credit card debt

Measurable - By 50% or $9,137 (rounded up to $10K)

Achievable - Monthly payments of $762

I am making payments, but if you click through on my Networth IQ graph, you’ll see that I’m basically back to where I started. I am holding $18K in credit card debt and I have 9 months now to chop that in half. I really thought I would be making a lot more progress on this goal in March since my medical FSA reimbursement came through. However, I had some unexpected car repairs this month for ~$550 which I put on my credit card. In April I am going to cash out a CD that is expiring and putting it towards this goal.

Grade: Fail because at Q1 checkpoint, I should be 25% complete on this goal. Tsk tsk.

Goal #3

Specific - Reduce my credit card debt on my highest balance card ~$10K

Measurable - By 50%

Achievable - ~$450 a month

Last month I gave myself a Pass rating for this goal because I am consistently making payments of $500 a month on this card, and my finance charges on its balance are about $60 a month. I think I still get a pass rating since I successfully made those payments all quarter. However, I am going to make a $800 payment in April to ensure I hit this target by year end.

Grade: Pass

Even though I got a pass on two out of three goals, I still don’t think I’m doing so great at the end of the first quarter of 2008. I think I have figured out why my big payments aren’t making a big dent.

A long time ago, I used my HELOC for a balance transfer on some of my credit card debt. That was July 2007. Since then, I haven’t really increased my payments to my HELOC to pay it down faster. However, I still classify that debt as credit card debt since that’s what it really is. I just wanted a lower interest rate on it.

What does this really mean? It means that I think I’m going to have to bump up my HELOC payments every month or else hold a bare bones amount in cash and throw every spare dime to my credit cards. I’m not really sure. I think I could easily increase my HELOC payment by $200 each month without much pain but I am uneasy holding my cash balances close to zero. I’ll have to think about it some more.